Robert Samuelson Ignores Reality About Solving Health Care
Robert J. Samuelson writes an extremely disappointing and misleading article about health care policy in today’s Washington Post.
The column starts out fine with Samuelson looking at the basic OECD data that shows America spends dramatically more on health care than any other industrialized country on earth but doesn’t get better health outcomes as a result. He correctly shows that a big problem with the American health care system is that we pay substantially more for the exact same services compared to what Europeans pay. He even points out we don’t actually use more health care than most other first world countries; we just overpay for what we do use.
The problem is that the column falls apart terribly at the end when Samuelson states there are essentially two ways to fix our system.
One is a voucher system that, through tax credits and fixed Medicare premium subsidies, would allow patients to shop for the best health plan. Competition, the theory goes, would force hospitals and doctors to restructure the delivery system; health plans would compete on the basis of price and quality.
The other way is a government-run, single-payer system that would — somehow — include strict budget limits on doctors, hospitals and other providers. Lower administrative costs alone wouldn’t provide enough savings to control overall spending. If open-ended reimbursement survived, so would the existing system.
This is just wrong on some many levels. There is basically no credible data to show that a voucher system to purchase private insurance would work to reduce health care costs. The Medicare Advantage program, which was supposed to save money through competition among private insurers, ended up significantly more costly than regular Medicare. The federal employee health care exchange system, which relies on private insurers and was also supposed to benefit from the magic of insurance competition, has also failed to control costs.
Just paragraphs before offering this solution Samuelson states, “government regulators and private insurers are too weak to control costs.” If you are basically claiming the problem is that private insurers and government have too little market power to effectively negotiate for cheaper services, how is radically diluting that market power over hundreds of million of people with vouchers going to magically make things better?
To say there is a “theory” behind this voucher nonsense is too kind. It is a fantasy that some believe in spite of all the data to the contrary.
While I personally support single payer, it is beyond silly to start a column talking about all the other international health care systems but then pretend they don’t exist as possible solutions to our cost problem. There is a whole mix of different systems in use in other countries with varying levels of government involvement, and all are significantly cheaper than our own. Even adopting an all-payer system with private insurance and private providers, as in Japan, would likely significantly reduce our health care spending.
The main reason other systems are cheaper is that they have a mechanism to limit providers with basically near monopoly status, like drug companies and hospitals, from using that market power to dramatically overcharge patients.
There are many ways to reduce our health care spending; simply adopting the better health care systems of any of several dozen other industrialized countries would work.
Part of the problem in America is that instead of logically choosing a solution from any of the other proven health care systems currently in operation, our political leaders and pundits keep getting away with claiming that a disproven market fantasy can magically fix everything.